Georgia bill would create state depository for gold and silver

SEATTLE (Scrap Monster):  A bill moving through the Georgia legislature could create a new way for people to store and use gold and silver.

Senate Bill 424 would allow gold or silver to be used as legal tender in Georgia. It would create a state depository where people could store gold or silver instead of holding the physical metal.

Dr. Greg George, director of the Center for Economic Analysis at Middle Georgia State University, says the proposal is meant to allow people to use gold and silver both as precious metals and as a form of currency.

“It’s somewhat of a convoluted bill that is kind of an attempt to allow people to utilize gold and silver as precious metals but also as a currency to help them hedge against inflation,” George said.

George says when someone makes a purchase, the depository could sell some of the stored gold and convert it into cash to pay for the item.

He says while the law would eliminate state taxes on transactions, the process could still create taxable events at the federal level each time the gold is sold.

“So it’s just a way to store your money in another form, so when you are not spending it it’s in gold and silver,” he said. “When you do spend it, it converts into cash and people have to accept that as legal tender. So it’s kind of splitting the baby a little bit, it’s trying to get some of the benefits of the gold standard without creating a gold standard.”

Senate Bill 424 has passed the Georgia Senate but still has to go through the committee and House before it could head to the governor’s desk for final approval.

Courtesy: www.41nbc.com